Pro: Bankruptcy can often be used to eliminate or significantly reduce unsecured debt.
Con: Not all debt can be removed during bankruptcy, student loan debt, some taxes and child support obligations generally may not be discharged.
Pro: An automatic stay results when an individual files for bankruptcy. This is a bankruptcy law protection that prevents creditors from privately collecting on their debts.
Con: A filer may be ineligible to obtain credit cards during the process.
Pro: Mortgage arrears and IRS debts can be paid over a period of up to 5 years to make retaining your real estate possible even when behind on the mortgage.
Pro: The law allows debtors to protect basic assets so often a bankruptcy is filed and no assets are lost.
Con: If there are assets with equity beyond the exemptions assets will be sold to repay debt obligations unless Chapter 13 is filed to pay creditors the value of the nonexempt assets over time..
Pro: Filing for bankruptcy is a sign to a person’s creditors that he/she understands there is a problem.